This case involved a claimant who had signed up as a courier through a mobile app to work for the respondent company.  This app allowed couriers to take on ‘ad hoc’ deliveries as well as ‘slot’ deliveries when they were committed to being in a particular zone at a particular time.   The slot system was used by the company to ensure that it had a guaranteed pool of couriers when there was high demand.   In terms of the slot work, there was a release notification that could be sent by the individual which would allow other couriers to accept the work on a first come, first served basis.   However, this was contingent upon another courier accepting the work and if none took on the job then the original courier would remain liable for the delivery.  Failure to carry out the work meant receiving a negative performance score, being ‘off-boarded’ as well as failing to receive bonuses.

The claimant brought a series of claims for unauthorised deductions and holiday pay which were contingent upon him receiving worker status rather than an independent contractor.   The EAT in making a decision on this point, focused on the release system that was put in place by the company.  The first instance Tribunal referred to the decision of Etherton MR in Pimlico Plumbers & Anor v Smith when he stated that a right to substitute only with the consent of another (who can withhold consent) will be consistent with personal performance.

In this case, the Tribunal found that the other couriers within the release system had an absolute discretion to decide not to take on the work thus leaving the original courier liable for that delivery.  Therefore, the Tribunal found that the individual was a worker as the other individuals had an absolute discretion not to act as a substitute.

The EAT agreed with the decision finding the individual to be a worker but slightly refocused the reasoning.  It held that the approach taken by Etherton MR in Pimlico Plumbers was not based upon the other couriers having the discretion but the person to whom the work is being completed.   Therefore, it should not be seen as the other couriers having this unfettered discretion to refuse the substitution but actually it was the company who retained this absolute right to withhold the consent.  Accordingly, there was no actual right of substitution at all but merely a hope that someone would take on that work if a release notification had been sent.  As a result, the EAT held that the individual had worker status and was entitled to the unauthorised deductions and the holiday pay claimed.

Practical Lessons

This case demonstrates, yet again, the courts finding in favour of an individual as a worker rather than an independent contractor in a further gig economy’ case.  This particular case focused on whether there was in fact a right to substitution  - a key dividing line between an independent contractor and a worker.

The right to substitute must not be subject to the company being able to withhold its consent and this can be seen in many guises.  In this, the consent could be withheld by virtue of the other couriers deciding not to take the work on.   If one is operating within the ‘gig economy’ they should be mindful of the extent to which they can substitute their work for another in determining whether they should have the rights of a worker.  If the company retains a fetter on when work can be substitute and the situations then it will be a factor weighing in favour of worker status rather than independent contractor.
https://www.gov.uk/employment-appeal-tribunal-decisions/stuart-delivery-ltd-v-mr-warren-augustine-ukeat-0219-18-ba